Pension fund ABP stops investing in fossil fuel industry

Pension fund ABP will stop investing in fossil fuel producers, such as oil and gas companies. The Netherlands' largest pension fund decided this in response to various disturbing climate reports recently published. For example, the United Nations (UN) climate panel showed earlier this year that people worldwide are already experiencing the physical consequences of climate change. Without more decisive action, global warming would reach an unacceptable level.

ABP indicated that it will gradually sell its investments in the oil and gas sector and the coal sector. The majority of these will be sold by the first quarter of 2023, the pension fund expects. It concerns an invested capital of over 15 billion euros. That is almost 3 percent of the civil servant pension fund's total invested capital. The fund assumes that this decision will not harm the long-term return.

ABP board chairman Corien Wortmann said that many ABP participants and affiliated employers have indicated that they consider it important that the fund also contributes to limiting global warming to 1.5 degrees. Until now, ABP tried to enter discussions with, for example, the oil companies in which it invests. Then the fund hoped to use its influence as a shareholder to encourage companies to go green. But concerning the producers of fossil fuels, on closer inspection, the fund sees "insufficient opportunity" to achieve significant acceleration of the energy transition in this way.

"We will focus our energy transition efforts on large users of fossil energy such as electricity companies, the car industry, and aviation," said Wortmann. ABP wants to continue to encourage these companies that use fossil fuels to become more sustainable. ABP will further tighten its investment criteria for these investments next year. The fund also wants to become stricter in other areas such as the conservation of natural resources, digitization, and human rights.